WaPo: Two “green” subsidies we won’t miss in 2012

posted at 11:25 am on January 2, 2012 by Ed Morrissey

Conservatives managed two quiet wins in their first year of controlling the House, although it took the Washington Post to notice both of them. After 30 years of federal subsidies for corn-based ethanol, Congress finally put an end to the program by refusing to renew the “green” energy technology program, which the Post notes did nothing to reduce greenhouse-gas emissions. Neither did the protectionist tariff on ethanol imports, which had the curiously self-defeating result of making the supposed “green” fuel more costly and less impactful on American oil consumption, and that also expired at the end of 2011. That will save taxpayers $6 billion a year.

Meanwhile, a lesser-known but equally dubious energy tax break also expired when the year ended Saturday: the credit that gave electric-car owners up to $1,000 to defray the cost of installing a 220-volt charging device in their homes — or up to $30,000 to install one in a commercial location. As a means of reducing carbon emissions, electric cars and plug-in hybrid electrics are no more cost-effective than ethanol. What’s more, only upper-income consumers can afford to buy an electric vehicle (EV); so the charger subsidy is a giveaway to the well-to-do.

The same goes for the $7,500 tax credit that the government offers purchasers of electric vehicles, a subsidy that, alas, did not expire at year’s end. The Obama administration says that the credit helps build a market for EVs, which helps create jobs. Given the price of eligible models, like the $100,000 Fisker Karma, that rationale sounds an awful lot like trickle-down economics.

Backers of the charger tax credit may lobby Congress to renew it when lawmakers tackle the payroll tax extension issue again in the new year. We hope that Congress says no. Not only is it a case study in upward income redistribution, it also would represent a deepening of the taxpayers’ commitment to what looks increasingly like an industry not ready for prime time.

Sales of electric vehicles were disappointing in 2011, with the Volt coming in below the 10,000 units forecast. In addition to its high price, the Volt brand is suffering from news that some of its batteries burst into flames after government road tests. Meanwhile, Fisker, the recipient of more than half a billion dollars in low-interest Energy Department loans, repeatedly delayed the introduction of its ballyhooed Karma — while repeatedly raising the sticker price. And now Fisker has announced a recall of the cars because of a potential defect in its batteries — made by A123 Systems, another large recipient of Energy Department support.

The Post recalls that Obama promised to have one million EVs on the road by 2015. So far, he’s about 980,000 short, despite spending billions in subsidies over the last three years as part of the so-called jobs stimulus package on early 2009. The Post notes that the high price and impracticality of EVs make such a figure a complete fantasy — and doesn’t even begin to address the problem that delivering on this promise would create, which is the production of electricity to meet the demand of the new vehicles. Thanks to the EPA, we are losing generating capacity, not gaining it, as they attack coal-based generation of electricity and the extraction of natural gas from shale through fracking. We’re subsidizing vehicles that only the wealthy can afford — and only the wealthy can afford the utter loss in value of these vehicles when their batteries require replacing, which creates all sorts of issues with disposal and toxic contamination in just a few years, too.

If we want to switch to a truly clean-burning power source both for mass production of electricity and power for personal transportation that the US can supply for itself, then let’s start planning a transition to natural gas, along with easing of regulatory obstacles to its extraction and production, along with the domestic oil production that will ease and fund the transition. We’re killing coal, gasoline, and electricity at the same time while demanding EVs that we won’t be able to economically buy or sell or even charge under current hostile regulatory policies. It’s not just one bad investment that we need to change, but a whole series of irrational policies that hamper American energy production and consumer choice. And that’s due to one bad investment in particular from which voters can divest themselves in November.

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I’m sure the EV’s will need a block heater in colder climates, agw not withstanding. The govt and our leaders continue to pursue this folly not because they want to make things better for us or the planet, they want to continue the theft of our tax dollars.

It’s not just one bad investment that we need to change, but a whole series of irrational policies that hamper American energy production and consumer choice.

“Irrational” is the descriptive word for this administration. Throw in “dangerous”, “malevolent”, “incompetent”, “deceptive” (as in consistently lying), “socialist”, “devisive”, etc. we’ve got to get these clowns out of the White House in November.

Giving the DNC money through technologies that actually make sense would require intelligent, thinking democrats. Unicorns are more common that that oxyoron. You go to stimulate with the statists you have.

If we want to switch to a truly clean-burning power source both for mass production of electricity and power for personal transportation that the US can supply for itself, then let’s start planning a transition to natural gas

Why plan anything?

If NG is a superior fuel, then the market will take care of developing and producing vehicles and service stations. If it’s not, as I suspect, then why encourage the government to shove it down our throats?

The Post recalls that Obama promised to have one million EVs on the road by 2015. So far, he’s about 980,000 short, despite spending billions in subsidies over the last three years as part of the so-called jobs stimulus package on early 2009.

The electric car fiasco is undeliverable given:
– you can convert any car to a natural gas “dual fuel” for under $2000
– we have enough natural gas to export
– a natural gas distribution system exists across the entire country including most “filling” stations. All they need to add is a compressor and fueling stations!

But just like the ATM elimitated the 24 hour bank teller, this would eliminate the refinery, the guy who delivers the gasoline, the people who test for leaky underground tanks, leaky underground tank clean up. A whole lot of jobs. AND it would decrease our dependence on folks that don’t like us (Venezuela, Saudi Arabia, etc.) and it would lower the world price of oil and hurt other folks that don’t like us so much (Russia). It also eliminates the large car battery recyclers. We obviously can’t make things cheaper for the average American, it would upset too many apple carts (profit centers).

What will it take to get government to stop subsidizing failure for their own benefit ie: vote buying, campaign contributions, with our hard earned tax dollars?
How about some personal responsibility for their actions? I bet that would slow them down.

A federal law requiring the use of 36 billion gallons of ethanol for fuel by 2022 still props up the industry

Ending the government subsidy without ending the government mandate only means that the pump price of gasoline will increase. The subsidy to the favored industry is still there, but will now come directly from consumers.

The ethanol mandate must go! Or at least give consumers a choice at the point of sale – ethanol or straight gasoline. Let’s see how long ethanol can sdtand on its own. One outfit locally is selling non-ethanol gasoline as fast as they can get it. I noticed an immediate improvement in my car’s mileage and it runs 100% better. The difference really surprised me. It costs a few cents a gallon more, and I have to drive ten miles out of my way to get it, but it is definitely worth the extra cost and effort.

They gave Germans a choice of ethanol in their gasoline but didn’t mandate it. Guess what? The German consumers turned it down flat. It is a boondoggle wherever it is tried, and for the federal government to mandate that I must buy it is nothing short of a softer form of tyranny.

There’s something about a pressurized container of explosive gas at my back that makes me a little skittish.

Akzed on January 2, 2012 at 11:33 AM

Well, I can understand that, but I drove a nat-gas taxi for a couple of months and had no problem. Some cities have buses that run on nat-gas, too, without noting any significant issues.

Ed Morrissey on January 2, 2012 at 11:37 AM

There is another problem with CNG vehicles that nobody seems to address. The huge amount of space that the pressure tank consumes. In the case of the Honda Civic GX (CNG powered), the pressure tank takes up the space taken up by the former gasoline tank plus half of the storage volume of the trunk. And it still only gets one-half the range of its gasoline powered version. If you want to get full range, you would have to give up the entire trunk space or more.

Then there is the filling problem. It takes a long time to fill up a tank from a home system, since the gas has to be compressed as it is put into the tank, and that like charging a battery takes a long time. And no one takes into account the energy consumed by the electric powered compressor.

The Obama administration says that the credit helps build a market for EVs, which helps create jobs. Given the price of eligible models, like the $100,000 Fisker Karma, that rationale sounds an awful lot like trickle-down economics.

As Ed has mentioned here before, the only manufacturing jobs Fisker is creating (and that we are financing) are in Finland.

1. It wouldn’t eliminate refineries. Gasoline is just one of the multitude of products produced by a refinery.
2. There are more bank tellers today than prior to the advent of the ATM.
3. The guy that delivers the gasoline will just shift products he/she can carry from a refinery or other company. Long Haul Truck Drivers are still in high demand.

Ken you don’t need a conspiracy theory to explain why we haven’t switched to either hydrogen or natural gas to fuel our vehicles. Especially when a number of your facts are erroneous.

The Obama administration says that the credit helps build a market for EVs, which helps create jobs. Given the price of eligible models, like the $100,000 Fisker Karma, that rationale sounds an awful lot like trickle-down economics.

And if the WaPo had any grasp of (or interest in) basic economics, their analysis could be moved beyond the lazy, standard, knee-jerk class warfare rhetoric. When government directs taxpayer money to make what through natural market demand would otherwise be a non-existent business artificially more competitive at the expense of significantly more market relevant enterprises, that is not “trickle-down economics”. That is command-and-control fascism…the junk economics supported by this administration and the WaPo.

The Obama administration says that the credit helps build a market for EVs, which helps create jobs. Given the price of eligible models, like the $100,000 Fisker Karma, that rationale sounds an awful lot like trickle-down economics.

As Ed has mentioned here before, the only manufacturing jobs Fisker is creating (and that we are financing) are in Finland.

pain train on January 2, 2012 at 12:15 PM

Interesting that they didn’t need to subsidize LCD/Plasma/LED flat screen HDTVs, who paid for the development? Why it was those evil early adopters. The rich people did it. The ones that paid $10,000 for their 40 inch plasma TV only a few years ago now.

The Post recalls that Obama promised to have one million EVs on the road by 2015. So far, he’s about 980,000 short, despite spending billions in subsidies over the last three years as part of the so-called jobs stimulus package on early 2009.

As long as the requirements remain for the expanded amounts of ethanol in gasoline the hoax continues. Consumers will now pay directly for ethanol at the pump rather than through subsidies. Nothing has changed. NOTHING.

Wonder how 2011 Motor Trend “Car of The Year” (VOLT) is doing these days? Many suspect the White House had something to do with the VOLT winning the bogus prize. Another Edsel. Complete waste of taxpayer money again by the Obama administration.

If we want to switch to a truly clean-burning power source both for mass production of electricity and power for personal transportation that the US can supply for itself, then let’s start planning a transition to natural gas, along with easing of regulatory obstacles to its extraction and production, along with the domestic oil production that will ease and fund the transition.

Holy mackeral, that entire paragraph is a random act of rationality by WaPo.

Yes, transition to natural gas, and eliminate the energy subsidies, especially the lavish subsidies for the Rube Goldberg wind and solar industries.

Too bad these campaign paybacks were ever initiated in the first place. Stopping these two is a good thing but its akin to catching the bank robber after he’s taken and spent all of the money. And, guess what, the bank robberies continue as will these politcal paybacks by Obama. How many more corruption cases like these two are still out there waiting to be discovered after the damage has been done?

BTW, I’m still waiting for all of the medicare fraud and waste to be curtailed. A promise we’ve heard for decades.

Our tax dollars should be considered a resource. lets be green about not throwing it down every available rat hole with no return. I know profit is a dirty word to some but if an investment subsidy doesn’t return a profit, it goes back to the drawing board for a better business model. A public offering on the idea might be considered.
When the country is united instead of divided there are no end to the possibilities..
When statements like increased unemployment helps the economy by our elected leaders is spouted
in the realm of reality, it signifies the garbage needs to be taken out, its starting to smell.

I’m guessing that the WaPo wanted to get their single 2012 article of real facts and common sense out of the way early in the new year so they wouldn’t have be concerned about the truth around election time as they protect their Democrat candidates.

Neither did the protectionist tariff on ethanol imports, which had the curiously self-defeating result of making the supposed “green” fuel more costly and less impactful on American oil consumption, and that also expired at the end of 2011.

I believe that we can now import ethanol from Brazil for less than the subsidised price we have been paying for domestic ethanol. There may be limits to the amount that can be imported. Brazil doesn’t use food for ethanol.

Of course the proper course would be to allow use of oil. There are no advantages to useing gas and there are substantial disadvantages. The fact that one person didn’t die useing gas is a nonsequiter. That is like claiming that since someone in special forces didn’t die, it is a safe occupation.

And now Fisker has announced a recall of the cars because of a potential defect in its batteries — made by A123 Systems, another large recipient of Energy Department support.

–
You’d be surprised how easy it is for a little bit of damage or to have a small manufacturing defect create a hazard with lithium batteries. The bigger the power pack, the more the odds of a problem, and the bigger the hazard.
–
Add to that the push to hurry-up and go EV (and pile of cash from the gov for those who yell Eureka!)… “Danger Will Robinson… Danger”
-

So, CNG is impractical in smaller vehicles (currently) but has a legit place in larger urban vehicles.

Here’s a fresh idea; let’s apply each solution to the places where it’s currently practical, while we develope a broader infrastructure for it, and work to make each technology more broadly applicable.

Oh, and; as it starts to work out well, investements by private firms will follow, as a rainbow after a storm.

A federal law requiring the use of 36 billion gallons of ethanol for fuel by 2022 still props up the industry

Ending the government subsidy without ending the government mandate only means that the pump price of gasoline will increase. The subsidy to the favored industry is still there, but will now come directly from consumers.

Assegai on January 2, 2012 at 12:08 PM

Yes. This law amounts to a mandate, unless you choose not to drive, of course. Then there is the fact that it is an idiotic idea from the start.

This is one of the first things that needs to be addressed, along with the unfettered powers that the various regulatory agencies are abusing at an unprecedented scale. This abuse of power by the executive is undermining the underpinnings of our freedom that the Constitution so carefully laid out with the separation of powers and the Bill of Rights.

and that like charging a battery takes a long time. And no one takes into account the energy consumed by the electric powered compressor.
Dasher on January 2, 2012 at 12:12 PM

Are you sure they use a compressor and not a Haskel pump?
Haskel Air Amplifiers provide an alternative to purchasing dedicated high pressure compressors. They are compact, require no electrical or mechanical drive connections, are powered by the same air they amplify, and can be mounted in any position.

He is who we thought he was…A man who had never run so much as a lemonade stand. A man who never had a private sector job. The democrats put this man at the helm of a Superpower…The rest is history. The green energy fiascos are actually small losses for Hussein, the new King of debt…He’s racked up 4 trillion in deficit spending with nothing to show for it…He has put this country on the path of a Greek style debt crisis.

and that like charging a battery takes a long time. And no one takes into account the energy consumed by the electric powered compressor.
Dasher on January 2, 2012 at 12:12 PM

Are you sure they use a compressor and not a Haskel pump?
Haskel Air Amplifiers provide an alternative to purchasing dedicated high pressure compressors. They are compact, require no electrical or mechanical drive connections, are powered by the same air they amplify, and can be mounted in any position.

DSchoen on January 2, 2012 at 4:38 PM

Home NG is very low pressure, and a compressor has to get it somewhere between 3000-10000 PSI depending on the vehicle and technology used. Here is a typical home refueling station that uses between 800-1000 watts and over night (8 hours or more) to refill a CNG vehicle.

The so-called ‘green energy’, bailouts and the stimulus packages were not just failed ventures he hoped would work out but carefully planned and perfectly executed operations to redirect the flow of capital to effect just what we have today; a high unemployment rate within a recession. He and that idiot Bush have secured America’s future; indentured servitude to the money lenders and the power elite. We’re screwed.

Aside from graft, there was no good reason for the greenies to focus on electric vehicles. It doesn’t eliminate the burning of fossil fuels; it only kicks it down the road to the Con Ed plant. And what this does to a grid already constantly on the brink of a blackout is inexcusably irresponsible.

What is the holdup on hydrogen cells? Is it just a case of lack of refueling infrastructure? Why couldn’t this have been the focus of those who want government to pick winners and losers? Unfortunately, they only seem to pick losers. If the graft had at least produced some hydrogen fueling stations, at least we would have that to show for it. Instead we have a year’s worth of super-expensive lemons that only billionaires will buy, which can show up as the villains in the next Pixar Cars movie.

Batteries are dinosaurs, even new technology batteries. The whole concept is out of date.

Hey, here’s a novel approach: how about drilling for gasoline, and in a big way, to boost the economy out of this Depression, so that private enterprise can tackle the problem with CAPITAL and COMPETITION and INNOVATION, and get the damn politburo out of the board room?

We need to eliminate the Department of Energy. And while we’re at it, the Depts of Education, Agriculture, Homeland Security and a host of others can be shut down as well. That would save a few trillion, and would go a long way to restoring some of the liberty these bureacracies continue to erode.